Processes targeting opposition politicians and economic assets associated with them have continued in Armenia in recent weeks. While public attention was previously focused mainly on the political dimension, questions are now emerging about the possible impact on the economy, property protection and the broader business environment.
The seizure of several properties and buildings belonging to Gagik Tsarukyan, as well as the process of transferring the Ararat Cement plant to state management, has raised new concerns regarding economic freedom, property rights and relations between the government and business.
Approaches to Property Could Damage Armenia’s Investment Climate
Political analyst Tigran Grigoryan says these developments could have a serious negative effect on Armenia’s investment environment, since businesses depend on clear and predictable rules.
According to him, if the perception develops that the ability to retain property depends on one’s political position, this could influence the decisions of both foreign investors and major Armenian business owners.
“If there are no clear rules of the game for businesses, including large businesses, then every actor will think several times before investing in Armenia. This applies both to foreign investors and to major local entrepreneurs,” Grigoryan said.
He believes that creating a link between political loyalty and the preservation of property could have long-term consequences even after a change of government.
Grigoryan noted that business owners who currently have no problems in their relations with the authorities may still begin considering future risks.
“If such measures are being used against the opposition today, similar pressure may tomorrow be directed at actors affiliated with the current government. People may then ask whether it is reasonable to keep all of their capital in Armenia and continue investing here,” he said.
The Contradiction Between the Promise of “No Vendetta” and Reality
The analyst recalled that one of the central promises of the 2018 revolution was that there would be no political vendetta.
According to him, the current processes raise serious questions because legal instruments may be used for political purposes.
“The revolution was carried out under slogans promising that there would be no vendetta. Yet we now see processes being initiated against various individuals largely for purely political reasons,” Grigoryan said.
At the same time, he noted that the confiscation of illegally acquired property could in itself be an acceptable legal mechanism if it were applied equally to everyone.
“If the Law Is Not the Same for Everyone, It Does Not Become an Institution”
Grigoryan said there are also professional debates over whether confiscation is the most effective approach from the standpoint of economic development.
According to him, the initial accumulation of capital in many countries was often accompanied by processes that were not entirely legal, and this reality must also be considered.
“This is both an economic and political-science question: whether confiscation is the correct approach or whether more effective mechanisms could be developed, such as returning those resources to society through other means,” he said.
However, the analyst argues that even if the state chooses to confiscate illegally acquired property, the mechanism must be applied according to the same standards in every case.
“If there is no single rule, no identical law and no equal condition for everyone, then this ceases to be a law or an institution. It becomes a political instrument used against opponents but not against loyal figures,” Grigoryan said.
As an example, he pointed to the difference between proceedings initiated or not initiated against several figures associated with the former political system.
“We know that MP Khachatur Sukiasyan, who was previously part of the ruling party, is also involved in several cases concerning the confiscation of allegedly illegal property. However, we see no developments in that direction, while opposition figures, particularly those active during pre-election and election periods, are subjected to this kind of treatment,” he noted.
Economic Freedom Is the Foundation of Political Freedom
According to Grigoryan, even countries with limited political freedoms have managed to achieve economic development because they maintained the fundamental principles of property protection and economic activity.
He cited Singapore as an example.
“Singapore was not a democracy for decades and is still not a classical democracy today. Nevertheless, it preserved the principles of property inviolability, free trade and generally accepted economic rules. That is why countries of this kind are able to develop,” the analyst said.
He added that even states pursuing tougher government policies to promote economic growth first ensure the protection of property rights.
“Once this principle is violated, it is pointless to expect major investments in Armenia unless those investments are based on political arrangements,” Grigoryan said.
He noted that similar concerns had already emerged during the nationalization process involving the Electric Networks of Armenia.
According to him, there are professionals within the state system who understand the potential damage, but the public interest is often subordinated to domestic political objectives.
“I believe there are technocrats and bureaucrats within the government who understand these problems and may even admit in private conversations that this has caused serious damage to Armenia. But here, as in many other matters, the prospects for economic development and the broader state interest are subordinated to narrow domestic political goals,” Grigoryan said.
“Unfortunately, this is a pattern that has existed throughout the post-Soviet period, both in Armenia and in many other countries. We are once again returning to the status quo that existed before 2018, when a political force that came to power with different promises ultimately began using similar instruments,” he added.
According to the analyst, these developments send a warning not only to large businesses but to all entrepreneurs regardless of the size of their operations.
“This is a signal to every business owner that engaging in politics may be dangerous,” Grigoryan said.
Economic Pressure Also Restricts Political Competition
Discussing the political consequences of these processes, Grigoryan stressed that economic freedom is directly linked to political freedom.
According to him, if a country lacks economically independent actors capable of operating freely, it becomes difficult to build a sustainable opposition and genuine political pluralism.
“Economic freedom is always the foundation of political freedom. If businesses are presented with a choice — either you support us politically or you lose your business — then a healthy opposition cannot emerge in such a system,” the analyst said.
Grigoryan believes that this pattern has already been repeated many times across the post-Soviet region and that Armenia risks returning to the former model of relations between political power, business and property.